JP Morgan Foresees Massive Institutional Adoption Of Bitcoin

ByTroy Morris

Dec 14, 2020
What are the Risks of Investing in Bitcoin Stock

The America-based investment bank revealed it foresees a high demand for cryptocurrencies by institutional buyers. The comment came as a surprise in the crypto space due to the previous stance of the bank with digital assets.

The investment bank has often had it, officials, criticizing the blockchain technology and have been very open with their doubt with its existence in the financial world. Jamie Dimon, an executive of the institution even referred to cryptocurrencies as fraud around the month Bitcoin had its all-time high. Recently, JP Morgan has been warming up to the idea of the digital asset and has made available some option in its platform for cryptocurrency investment.

Increased demand by Institutional buyers for Bitcoin

The year 2020 has been successful for cryptocurrencies due to the purchase of crypto by Institutional, according to JP Morgan. The bank opines that the recent MassMutual’s $100 million purchase could drive in an overwhelming demand by investment companies and insurers and could fetch Bitcoin up to $600 billion.

It sees the purchase as the needed push for other companies to make their decision on investing in digital assets. The cause of the sudden attention institutional buyers are paying to Bitcoin is not yet known. Still, some claims suggest that the COVID-19 influenced the digital asset industry to be seen in a different light.

Numerous investors and large companies are rapidly buying big chunks off Bitcoin, which is helping the asset to gain more popularity. Recently, an institution plans to do a fundraising to buy even more of the cryptocurrency, after purchasing multimillion dollars worth of the asset.

Wall Street investors are also not lagging in the new demand for digital assets, with a strong preference for Bitcoin and Ethereum over other assets. The insurance company’s buy is the latest among the long list of investors that have bought large amounts of the currency.

Why retail buyers are no longer dominating the cryptocurrency market

Some officials of the asset bank analyzed the recent entry of investors like MassMutual, signalling a difference in the former retail buyers like family offices and wealthy investors, to the present institutional buyers. Some sources suggest that institutional investors cannot make high priced risk in the volatile asset, but the rise in the high net worth institution’s investment could help crypto over the long term.

The bank opined that even the pooling of 1% of companies net worth to invest could be enough to accumulate the suggested $600 billion. The predicted price’s addition to the Bitcoin market would substantially help stabilize the market and will increase its worth, according to strategists.

They suggest that the current worth of the Bitcoin market is $350 billion, and if the prediction goes as expected, the BTC market would be so rich in value, rapidly increasing its worth and exposure. The increased demand for the asset is usually for diversifying an asset class and resisting the weaknesses of cash currency. Even with the incredible gains in the investment, the volatility is still a considerable concern for serious investors and could be the strongest hurdle the currency will face.

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